It’s a fun game, isn’t it? Imagining you have won a million dollar windfall and trying to figure out what you would do with it. Or, a different scenario: you work your butt off for 40 years, saving and investing wisely, and eventually get to a net worth of a million dollars. Phew. Now what?
A Million Dollars Isn’t That Much!
I think we’re all very aware that a million dollars isn’t what it used to be. In either scenario, whether you have worked and accumulated a million dollars, or whether you’ve received a windfall, you absolutely cannot go crazy and start spending uncontrollably. Let’s take a look at what you CAN do with a million dollars.
Invest for Income
This applies to the second scenario – the one where your net worth, after years of hard work, is a million dollars. Assuming your investment mix can generate an annual taxable income of 8%, a million dollars can generate an admittedly nice income of $80,000 per year – for many this is all it takes to comfortably retire, and for those of us living in more expensive areas, in major cities along the US coast, it would still be a major boost to whatever other retirement income we might have.
Spend Wisely
If you get a million dollar windfall at some earlier point in your life, when you still have many working years ahead of you, I would advise against viewing this as your ticket out of the workforce. As we saw above, this kind of money generates a nice income – but not necessarily enough to retire on, especially if you’re young and still need to raise kids. In addition, if you start using all the income that your nest egg generates at an early age rather than reinvest, your money will be gradually eroded by inflation.
What Would I Do?
The things on my own list if I ever received a sudden windfall include non-exciting items such as paying off any credit card debt, student loans and home mortgage. I would also reserve a small percentage (anywhere from 1%-5% or up to $50,000) for helping close family members such as parents and siblings with repaying their own debts and give another 1%-5%
to charity.
No Splurging At All? You’re So Boring
I actually do not rule out splurging a little. It’s normal to want to splurge when you receive an unexpected, large sum of money. I guess in my case I would allocate 1%-5% for splurging – this could go towards buying a new car, renovating the house or buying new furniture or art. Whatever floats your boat, by all means splurge a little on it, but do limit that splurge. It’s very easy to waste away a million dollars.
And the Rest?
So I repaid debt, gave some to family and some to charity, even splurged a little. Let’s assume I was left with half a million dollars. Now what? Now I invest, and I treat this as any other investment, creating a mix of stocks, bonds, cash, commodities and REITs – Whatever
I’m generally comfortable with. Now I sit back, watch the money grow, rebalance once a year and resist the urge to do anything else with that money, except for enjoying the extra security I now have.
What would YOU do with a million bucks?
Editor's Note: I've begun tracking my assets through . I'm only using the free service so far and I no longer have to log into all the different accounts just to pull the numbers. And with a single screen showing all my assets, it's much easier to figure out when I need to rebalance or where I stand on the path to financial independence.
They developed this pretty nifty 401K Fee Analyzer that will show you whether you are paying too much in fees, as well as an Investment Checkup tool to help determine whether your asset allocation fits your risk profile. The platform literally takes a few minutes to sign up and . For those trying to build wealth, Personal Capital is worth a look.
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Please take some time to understand our full policies and disclaimers .How much does it cost to go Off-Grid and to live on the Land?Updated on June 26, 2014
See all 3 photos
&&&How much Money does it take to Go Off
There are 10 things that you need to
consider when going off grid and living on the land.
communication
transportation
protection
Cob Cottage
See all 3 photos
Building a Cob CottageWATER
1. One of the most important items to find when preparing to go off grid is land with
on it. Everything else can be brought in but water is essential, one must have a good water source. Ideally, it would be nice if you also had a well on the land. It doesn't matter if there is a house on the property because you can build your own house for as little as $1,000 or for as much as you want, but water...running water would be a nice luxury. Not only do you need water for drinking but you also must have it to irrigate plants, support animals and if you have a decent running stream of water you can have all the electricity you want for FREE! However, even if you can't find a tract of land that has a stream or creek on it you can still set up a
system so don't despair if you can't find water on the land...it's still in the sky!
2. Regarding land, some people say that the least amount of land you can get by with is
acre. Personally that seems rather small to me. I think 5 acres is more like it. You want to make sure the land is habitable, that it can grow crops, that it's not in a flood zone and that it is relatively flat enough to put a house on and farm. As I mentioned previously having running water on your land is like having a gold mine, that is very important. You can find land for as little as $1,000 an acre and less but it probably wouldn't have water on it. I'm thinking it might cost about $5,000 to get a decent amount of land with some water on it but it's an educated guess from what I've researched. I recently did a little research on Craigslist and found a beautiful tract of land that was $123,000 for 160 acres of beautiful land. It was about one hour south of Portland, Oregon. If you went in with 16 people that would be approximately $7,500 for 10 acres of land in a great area! You could even divide it into 5 acres for less than $4,000. So you might have to look a bit but deals are out there and believe me the prices will continue to go down.
3. When it comes to shelter most people think that that is the most expensive part of the equation, but I have recently discovered Earthen houses and . What are Cob Cottages? Cob Cottages also known as earthen houses are homes made out of mud, sand, straw and lime. They do not require wood framing although you can use it. And you do need some rocks for the foundation. But, the main advantage of
is that anyone can do it and the materials are very cheap and in many cases completely free. I have included a website that teaches you how to build with cob. They say you can build a house for as little as $1,000, but I am conservatively estimating about $5,000. I am not sure if their definition of house is the same as mine but nevertheless, watch the videos and learn. People have been building cob houses for millenniums, some are still standing. They are much more durable than houses made out of wood and plaster and it's easy to repair them. And...they are so cute!
4. It goes without saying that food is very important. A greenhouse is a must as well as a garden. There are books on how to build underground self-heating greenhouses for as little as $500. With all the chem-trails in the sky a greenhouse makes a lot of sense, not to mention having a food source year round. Animals also provide non-, fresh food. Chickens, pigs, sheep, goats, ducks and cows all replenish themselves and take relatively little care. They also provide other products like wool, feathers, and lanolin. The cost of your animals will vary as well as the cost of seed but I would estimate it to be about $2,000.
COMMUNICATION
5. Communication is also very important. Satellite Internet Services are one way to go and they are relatively inexpensive. Also ham radios are another source of off grid communication. I think communication is very important as you need to protect yourself and how can you do that if you don't know what is going on. The cost for this is about $300 start up and $60 a month. However, if no satellite service is available or if you just don't want the government knowing exactly where you are via your computer or cell phone you can always opt out and get a CB or ham radio and save the $60 bucks a month.
6. These days there are many different sources of off grid power, some of them are solar power, wind power, hydro-power, and human power. All of these cost money, but I think that hydro-power is your best bet. You can buy a “backyard” hydro-power generator for about $2,000 and they say it will generate more than enough electricity for a good sized household. Of course if you are up north the water may freeze over the winter so you would have to have a back-up plan like a windmill or solar panels but if you are not up north water runs constantly (unlike the wind and sun) and you can meet all of your electricity needs with one source. Most of you are well aware of wind turbines and solar panels but there are also human powered bikes out there that can also help in a pinch, besides why work out on a treadmill that doesn't generate any electricity when you can work out and generate electricity at the same time?! Hydro-power is the most economical of the three, it provides the most power for the least amount of money. Wind turbines only work when the wind is blowing and solar power only works when the sun is shining and both are more expensive than micro-hydro power. Having said that, conserving power is one of your best bets while living off-grid. The less power you need the less you have to get. So before you do anything your home should be positioned and created in such a way as to require LESS power in the first place.
7. In some areas of the country you might not have to worry about staying warm, but in others it will be a factor. If you build a cob house you will already be ahead of the game as they are very warm and it's easy to build a fireplace in them. In some states (like Ohio) you might be able to find a piece of land that has free natural gas on it, that would be a great boon as you wouldn't have to worry about finding and chopping wood. I think the most important factor regarding warmth is to make sure you build a house that keeps the warmth in in the first place. After that you can consider, wood-stoves or solar panels. I have just included this in the price of the house for a fireplace. However, if you do need a wood-stove, a really good one will cost you about $5,000. They have some at Lehman's hardware that are just wonderful and will heat your water as well. Personally, a wood-stove is on my must have list.
TRANSPORTATION
8. Personally, I would like to never own a car again as they require too much invasion of privacy. You have to get a license, register it, get insurance and on and on it goes. So my preferred method of transportation would be a . They have storage ability and are more stable than bicycles. I know, I know it might be difficult to go without a vehicle because of what could come up but another method might be to actually have a couple of horses or even a donkey on your property. At least animals replenish themselves! A tricycle costs about $1,000 to $2,000 dollars. Another alternative is to make your own solar car (you can find them on You Tube), however to do this would cost about $5,000, you can also buy a diesel engine car and grow your own vegetable oil but again the cost would be up there at about $5,000.
PROTECTION
9. Protection: Well, there are several ways that you can protect yourself. The first thing that comes to mind are fire-arms and I'm all for that but you'd better know how to clean them and use them before you get them. However, there are other methods to protect yourself as well. One method is by hiding. If you put a living roof on all your buildings it might be difficult for anyone flying over to notice that you are there. If your greenhouse or even your main house is partially underground it also would be difficult to know if you are there. Offense is just as important as defense. Dogs are also good sources of protection as are security cameras and security fences that are invisible. These costs will vary but should be minimal.
10. Waste: Hopefully you wont have too much waste because you will use it. The absolute most wonderful book in the world (OK maybe that was a slight exaggeration) is The Humanure Handbook. Anyone who is even thinking of going off grid should buy this book. It tells you how to set up a humanure (composting ) toilet system that is incredibly cheap and will provide you with the best fertilizer your dirt has ever had! This is a MUST read and is listed above if you want to purchase it. If you dont' want to go the humanure composting route the next best thing is an incinerator toilet that doesn't use any water (therefore no need for a sewer system) and reduces human waste to non-toxic ashes. It can be put anywhere including on a boat or on the highest mountain. They run about $2,000 which is a lot less then putting in a sewer system but certainly $2,000 dollars more than using the humanure system.
Regarding income and . I have tried to construct a scenario that you could live without a job (considering so many people in this country are unemployed). One could easily sell a couple of pigs and some produce to acquire the needed money for property taxes. In some parts of the country 1 pound of wool goes for about $150. You do the math...a handful of sheep would more than pay for your taxes or other monetary needs. Cottage industries like making woolen articles from sheep, selling heirloom seeds and plants or eggs, milk and cheese would be more than sufficient. In order to get the things you need without paying any income taxes you could
items. An idea would be to set up a bartering store and list items you have and items you need and then negotiate with your neighbors.
Finally, I haven't gone off grid yet but as you can see I've done a lot of research on it and hope to do so someday. I do think that if you can form a community and go off grid together that that would be optimal. And, I am also hoping that this way of life is viable in America in the future. Things are getting so bad so quickly that I'm unsure about whether it will be safe to stay in this country much longer. I hope this helps anyone considering going off grid and if you know of other inventions or other helpful suggestions please comment. I think that you could
for about $25,000 very nicely.
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Related articles by Brie HoffmanIt's one thing to have a few cans of food in the pantry but quite another to prepare for a delayed, long-term societal collapse.
What items should you have if the power grid goes out and stays out?
Here is a succinct list.Cottage Industries
Going off the grid has been on my mind for awhile now. However, one of the roadblocks to going off the grid is the problem of making enough cash/money to pay your taxes, purchase items that you can't get off the grid or just havinOk, well...The one area that must be addressed when going off-grid is what to do with YOUR waste and I'm not talking about potato peelings here! If you want to go off-grid that means there will be no...One of the challenges to living off-grid is getting hot water. There are several ways of getting hot water that do not require connecting to the grid system. Each method has it's pros and cons and choosing a...OK, so you caught the off-grid bug and now you are looking to cut the apron strings, quit the rat race and head for the big out doors to try your hand at off grid living. But where do you go and how do you...The Pros They are cute. If you've ever fantasized about having a fairy tale cottage in the woods you've probably imagined a cob cottage without knowing it. Cob cottages are those cute little Hansel...Totally Self-Sustaining Energy Producing Prefabricated HouseThe 4 Best Ways of Generating Off-Grid PowerSo, you've thought about whether or not living off the g you know that it means no more utility bills and generating all of your own power, but what's involved in that? It isn't asOff Grid CommunitiesI get about 20 emails a week from people who want to go live "off the grid" without utility power and water, so I
-- a way people could pool skills and resources.
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